How to retire like a cheapskate—and live well

Being a cheapskate means being a smart consumer

BOSTON (MarketWatch)—On paper, it might seem a difficult task: Retire on the cheap while enjoying the standard of living to which you are accustomed or you desire.

But Jeff Yeager reports that it’s really possible, if retirees are willing and able to follow the principles outlined in his new book, “How to Retire The Cheapskate Way.”

How to boost income in retirement

According to Yeager, there is a trend among those planning for or living in retirement toward being “selfishly employed.”

Jeff Yeager.

Being selfishly employed, according to Yeager, means taking your interest, passion, or skill and turning it into a cottage industry. “You are your own boss,” he said. “It’s not intended to be full-time work. It’s by and large not intended to be ventures that require any significant investment of time. No real risk. This is a very common phenomenon among my cheapskates…And most of these people are doing it every bit as much as way of occupying their time as perhaps need for the additional income.”

Being selfishly employed, in essence, means doing something in your life that you’ve always wanted to do, but had a full-time job that got in the way. “They couldn’t do it for a living, but now they can work at it as their interest allows,” said Yeager, who at 53 is semiretired writing about retirement. “Remember, it’s only work if somebody makes you do it.”

Yeager said some selfishly employed typically earn income but less than what would decrease their Social Security benefit, while others care less about diminishing their Social Security benefit.

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According to the Social Security website: “If you were born Jan. 2, 1943, through Jan. 1, 1955, then your full retirement age (FRA) for retirement insurance benefits is 66. If you work and are FRA or older, you may keep all of your benefits, no matter how much you earn. If you are younger than FRA, there is a limit to how much you can earn and still receive full Social Security benefits. If you are younger than FRA during all of 2013, we must deduct $1 from your benefits for each $2 you earned above $15,120. If you reach FRA during 2013, we must deduct $1 from your benefits for each $3 you earn above $40,080 until the month you reach FRA.”

In his book, by the way, Yeager lists some 50 no-risk/low-risk selfish employment ventures, some of which are “offbeat and a stretch.” But two such jobs—in addition to the well-worn consultant as well as those turn hobbies and crafts into a business—are becoming increasingly popular: personal concierge/assistant and power washer—as in people who power wash decks and houses.

“I think there is going to be an increasing demand for personal concierge/assistants as people age and as working people’s lives become busier,” Yeager said.

The bad news, said Yeager, is that if you are looking for full-time employment, it’s hard to find. The good news is that if you are willing to hang out your shingle, as say a party planner, you might be surprised at how easy it is.

Those who have design on becoming selfishly employed should, however, do so with their eyes wide open, mindful of some risks and hurdles. For instance, Yeager warned against overextending oneself financially, or starting a venture that becomes more full-time instead of part-time (unless of course that’s what you want.) “Another risk you run if you do this very typical model of taking a hobby that you’ve always enjoyed and attempt to convert it into business is that pretty soon it no longer becomes fun,” he said. “Jewelry-making was fun until it turned out that I had more orders than I could take and now I don’t want to do it anymore.”

Another potential hurdle is separating your selfish employment both physically and timewise from the rest of your life. The growth of your business could impinge on your leisure. “If you are content to be retired, the growth of your business becomes a potential problem.”

In fact, in some cases, he said the selfishly employed’s biggest priority is to prevent growth of their business. “Sometimes it’s hard to put the brakes on,” he said.

By way of background, Yeager knows of which he speaks in large part of because of the database of some 3,000 people that he maintains. His “miser advisers,” as he calls them, provide him with countless real-life examples of ways to spend smartly and earn income in unusual ways in retirement.

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